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High Pressure At Goodyear

May 04, 1997

News: Analysis & Commentary: LABOR

HIGH PRESSURE AT GOODYEAR

A strike will test Gibara's strategy-and his strength

Samir F. Gibara had his hands full when he took over as CEO of Goodyear Tire & Rubber Co. last year. His predecessor, Stanley C. Gault, had revived the company by erasing some $3.7 billion in debt and expanding globally. To keep Goodyear rolling, Gibara shifted production to low-wage countries and pushed for more flexible work rules in the U.S.

Now, as a result of those moves, the Egyptian-born executive faces his biggest test as CEO. On Apr. 20, 12,500 union members walked out of nine Goodyear factories. The company was still negotiating with the United Steelworkers of America (USW) three days later, a positive sign. If a deal isn't reached before Goodyear's inventories run out, the dispute could become a nasty mess similar to the 27-month Bridgestone/Firestone Inc. strike, says Douglas M. McCabe, a labor professor at Georgetown University. That dispute was settled in December but not before the union originally representing the workers, the United Rubber Workers, collapsed.

Gibara wants concessions that would allow Goodyear to match work rules at Bridgestone and Michelin Corp., whose U.S. plants are mostly nonunion. "Goodyear is moving from a paternalistic culture to a performance-based culture," he told shareholders at the company's annual meeting on Apr. 14. Steelworkers, however, see Goodyear's proposals as threats to their middle-class lifestyles. "We make $19 an hour and they make 89 cents an hour" in Chile, says Tim Donahue, a picketer outside Goodyear's Akron technical center.

If the strike continues, Gibara must decide whether to hire replacement workers. If he does, the Steelworkers will hunker down for a long fight. And Gibara will be in for a very bumpy ride.By Peter Galuszka in Akron